Where are we headed in 2014? Of course, no one knows for absolute certain, but there are good sources of educated outlooks. One is Kiplinger.
Kiplinger's economic outlooks include things like slowly building momentum for the GDP; an unemployment rate that continues to fall; short-term interest rates that stay low and inflation that ticks up only slightly in 2014. Kiplinger also forecasts increases in both retail and housing sales, as well as business spending, although tempered by continued uncertainty.
It’s also helpful to look at how some vertical business sectors could perform in 2014. As with broader economic indicators, no one, even leading economists, has a crystal ball. But there are factors and trends that can point to how events might unfold during the year.
Kiplinger says we should “look for retail sales to accelerate steadily in 2014…”, owing to a stronger economy and ongoing job creation, albeit still less than robust. Grocery, electronics and food service sales are all growing, and post-summer increases in restaurant and bar sales could signal less belt-tightening and more discretionary spending among consumers.
Early reports, generally, seem to indicate solid holiday sales for 2013, although retailers still face ongoing challenges like balancing brick-and-mortar vs. online sales and consumer expectations for deep discounts.
The National Restaurant Association Industry Forecast, not yet published for 2014, is an annual barometer of the industry's economic strength. In addition to industry employment data and consumer trends, it covers full service, limited service, social catering and onsite food service in hospitals, schools and businesses.
For the past year, the association projected a record high of $660.5 billion in restaurant and food service sales. With other indicators on the rise, especially consumer confidence and discretionary spending, it would appear that restaurants and food service would continue to enjoy growing sales in 2014.
The association reports that restaurants employ over 13 million people, or 10 percent of the U.S. workforce. While this is a huge positive, restaurants are extremely sensitive to the labor market: In fact, labor costs consume about one-third of a restaurant’s total sales, according to Small Business Chron. Health care coverage and minimum-wage reform are two big—and ongoing—industry challenges that will continue to be debated in 2014.
Reporter Justine Coyne’s recent blog post for the Pittsburgh Business Times was headlined Manufacturing Outlook Up for 2014 and was based on the Pittsburgh-based accounting firm Schneider Downs’ third annual analysis of its Manufacturers’ Economic Survey. About 70 percent of respondents said they expect customer demand (sales) to increase in 2014, and 39 percent expect to add to their workforce next year.
But despite the optimism, manufacturers are proceeding with caution in view of uncertainty regarding the U.S. economy and current fiscal policies. Employee benefits, raw materials and compliance issues are cited as top concerns.
Procurement specialist Procurian is also bullish on manufacturing for 2014, predicting a continuing “Manufacturing Renaissance.” Based on comments from Dr. Chad Moutray, chief economist at the National Association of Manufacturers (NAM), the company’s white paper, The State of Manufacturing: A Positive Economic Outlook for 2014 and Beyond, takes an in-depth look into the four trends that manufacturing industry leaders are tracking, plus nine things to watch in 2014. Click the link above to find out why things are looking up for the industry.Top of Form
A long-time staple of the U.S. economy, the transportation industry is driven directly by the retail and manufacturing sectors. Encompassing air, rail, water and trucking, it’s more complicated than that, but hopefully, this means that 2014 looks good for transportation.
Trucking, in particular, continues to be the dominant mode of freight transportation in the U.S. Factors like low inflation, a growing housing market, a booming stock market and moderate gas prices are expected to keep trucking rolling forward in 2014. In Transport Topics, the newspaper of trucking and freight transportation, three industry analysts also forecast steady, albeit slow, improvement in 2014 for both the economy and for trucking.
According to the California Construction Academy, many economists view the construction industry as a bellwether for the larger economy. In fact, the health of the entire U.S. economy does depend on construction! Construction is an $800 billion sector, comprising more than 729,000 establishments, employing 7.2 million workers and engaging 1.8 million self-employed workers.
In its 2014 Dodge Construction Outlook, a mainstay in construction industry forecasting and business planning, McGraw Hill Construction predicts that housing will lead the construction industry to moderate growth in 2014. In fact, it says, total U.S. construction starts in 2014 will rise 9 percent to $555.3 billion, significantly higher than the 5 percent increase (to $508 billion) estimated for 2013. Read the full report here.
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